SLO County Farm Bureau helps farmers win inheritance tax battle

San Luis Obispo County Farm Bureau Executive Director Brent Burchett

OPINION by BRENT BURCHETT

Farm and ranch families can once again pass along their land to the next generation, thanks to work by Farm Bureau and our very own San Luis Obispo County Assessor Tom Bordonaro.

For those who don’t know, our agriculture community doesn’t get many wins out of Sacramento these days. Our elected officials are further removed from the farm than at any time in our state’s history, and farmers must face each legislative session like they’re entering a fresh gauntlet of regulations, red tape and fee hikes, but we got a big win this session with the signing of Senate Bill 539 into law by Governor Newsom in October.

SB 539 clarifies a confusing, narrowly-passed Nov. 2020 initiative, Proposition 19, which limits tax protections for a parent or grandparent passing down their land to their kids. The three key provisions for property tax assessments under Prop. 19 as it was passed were:

If you don’t live in the property that was also your parent’s primary residence, the low Prop. 13 assessment will be stripped away and replaced with a new, much higher market value.

This new approach also would have limited the transfer of the old tax base to the first $1 million of market value over the old tax base for an entire farm or ranch.

It would have raised the taxes on the difference between the old tax base and the market value above $1 million plus the old tax base on the entire ranch or farm.

Since Prop. 19’s passage, Farm Bureau and Assessor Bordonaro have negotiated with state leaders to minimize the property tax implications for agriculture, and I am proud to report that SB 539 actually strengthens the tax protections that existed prior to Prop. 19 for family farmers and ranchers.

SB 539 now clarifies that each legal parcel, rather than the farm or ranch as a whole, will be assessed as a “family farm” under Prop. 19. The bill also clarifies that a “family home” and a “family farm” legal parcel upon which the family home is located are eligible for individual exclusions from property tax reassessment under Prop. 19.

Bordonaro represented the California Assessors Association in SB 539 negotiations, and our Farm Bureau was a voice for our 700 San Luis Obispo County Farm Bureau member families, and the more than 34,000 Farm Bureau members across California. We also want to thank our State Senator John Laird and Assemblyman Jordan Cunningham for voting for these changes.

It is a time-honored tradition that family farms are passed from parents and grandparents to their children and grandchildren. This should happen without a “death tax” being passed to the next generation. After all, we are talking about the land and farm infrastructure that produces the food and fiber we all rely upon. We should all hope that family farms survive.

Unnecessary and excessive property taxes do nothing more than discourage food production and result in higher prices at the grocery store. Thank goodness Tom Bordonaro and our Farm Bureau stepped up to straighten out the mess of Proposition 19 and assure that the family farm survives in our community and throughout California.

If you are interested in learning more about the specifics of SB 539 and how this affects your property, please contact me at bburchett@slofarmbureau.org or call our office at 805-543-3654. SLO County Farm Bureau will be hosting an informational forum in coming weeks on Prop 19. and the new law under SB 539.

San Luis Obispo County Farm Bureau has been advocating for farmers and ranchers since 1922. Brent Burchett serves as Executive Director. Learn more at slofarmbureau.org.

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